HomeMy WebLinkAboutJune 16 - Bond Ratings
City of Edina 4801 W. 50th St. Edina, MN 55424
Contact: Krystal Caron, Communications Coordinator
Phone 952-826-0347 kcaron@EdinaMN.gov EdinaMN.gov
FOR IMMEDIATE RELEASE
City of Edina’s ‘Triple-A’ Bond Rating Reaffirmed
Edina, Minn., June 16, 2016 – Independent bond-rating agency Moody’s Investors Service recently affirmed
its high bond rating for the City of Edina’s general obligation bonds. Moody's maintains a Aaa rating on the City's
outstanding general obligation unlimited tax (GOULT) debt, as well as Aa1 and Aa2 ratings on the essential and
nonessential lease revenue debt, respectively.
Moody’s Investors Service first gave the Aaa rating to the City in 2002. Finding that Edina has a large and affluent
tax base, solid financial operations and a modest debt profile, the agency has upheld that rating since that time
and again reaffirmed it this month. The Aaa GOULT rating reflects the City's large suburban tax base located in
the Twin Cities area, strong socioeconomic indices, very healthy financial profile and above average debt and
pension burdens.
The City recently sold general obligation bonds to finance street improvements, as well as utility system
improvements within the City and refund the City's outstanding General Obligation Capital Improvement Plan
Bonds, Series 2007A. Refunding those bonds will lead to an overall cost savings, allowing the City to pay off the
debt at the current, lower interest rates.
“The basic purpose for this bond issuance is the summer street reconstruction projects, but a big part of it was
paying back past bonds to save us $500,000 on future interest rates. The triple-A bond rating is an important
part of that to be able to borrow at such low interest rates,” said Finance Director Eric Roggeman.
In addition to the Aaa bond ratings from Moody’s, the City also maintains a AAA bond rating from Standard &
Poor’s, the company’s highest rating. Standard & Poor’s emphasizes several factors when assigning a AAA rating,
including a very strong economy with access to a broad and diverse metropolitan statistical area; very strong
management with strong financial policies and practices; strong budgetary performance with operating surpluses
in the general fund and at the total governmental fund level; very strong budgetary flexibility with an available
fund balance at 63 percent of operating expenditures; very strong liquidity with total available cash at 120.8
percent of total fund expenditures and 10.2x debt service, as well as access to strong external liquidity; weak
debt and contingent liability position with debt service carrying charges at 13.3 percent of expenditures and net
direct debt at 204.7 percent of total fund revenue, but rapid amortization with 76.6 percent of debt scheduled
to be retired in 10 years; and a strong institutional framework score.
“Receiving this rating is very important because it means the City can borrow at the lowest rates possible and
helps ensure that future Edina debt will be issued with the lowest possible expense and cost to the taxpayer,”
said Roggeman. “I think it really sets us apart to have two triple a ratings.”
For more information regarding the City’s bond ratings, contact Roggeman at 952-826-0414 or
eroggeman@EdinaMN.gov.
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